Peter Mondrose is the Editor-In-Chief at BusinessPundit. He received his degree in Economics in 1998 and a second degree in Journalism in 2004. He has served as a financial adviser, market trader, and freelance journalist for the last 11 years. When he's not investigating market conditions and reporting on workplace news, he can be found traveling with his wife, dog, and laptop. He can be reached at PeterMondrose@BusinessPundit.com or (929) 265-0240.

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Volkswagen gives 120,000 employees a 5% pay increase

Volkswagen might be in the middle of a massive emissions cheating scandal, but that hasn’t stopped the company from giving about 120,000 employees a 5% pay increase.

The company said Friday that 120,000 of its workers in Germany will get a 5% raise over the next year and a half.

That’s a pay raise for about 20% of Volkswagen Group’s global workforce. The pay increase was negotiated by the union, IG Metall.

VW workers were awarded an annual bonus of €3,950 ($4,430) just one week prior. That bonus was about one-third less than the typical bonus paid out by the company.

Last year Volkswagen admitted that it fitted as many as 11 million vehicles with technology capable of cheating on nitrogen oxide emissions tests.

The company’s shares fell by 40% after news of its cheating scandal broke. The company is still facing criminal problems in the US and by the European Union. $18.2 billion has been set aside to cover costs associated with recalls, car repurchases, and lawsuits.

The increase in Germany is far above the average wage increase of 2.4% last year. There is almost no inflation in the country which makes the pay increase even more attractive.

Audi or Porsche employees are not included in the pay increase, even though both companies are part of the Volkswagen group.